March 10, 2011

Preemie Birth Preventative Cost To Skyrocket

A drug for high-risk pregnant women that once cost between $10 to $20 per injection will next week cost $1,500 a dose, meaning the total cost during a pregnancy could be as much as $30,000.

Makena, a form of progesterone given as a weekly shot, has been mixed inexpensively for years in special pharmacies that mix custom-compounds that are not federally approved, according to an Associated Press (AP) report.

Doctors predict the price hike may deter low-income women from getting the treatment leading to more premature births and will certainly become a severe financial burden for health insurance companies and government programs that have been paying for it.

Physicians had not anticipated the dramatic price hike, though "” especially since the cost of development and research had been shouldered by others in the past. "That's a huge increase for something that can't be costing them that much to make. For crying out loud, this is about making money," said Dr. Roger Snow, deputy medical director for Massachusetts' Medicaid program.

"I'm breathless," Dr. Joanne Armstrong, the head of women's health for Aetna, added.

The US Food and Drug Administration (FDA) is not involved in setting the price for the drugs it approves.

The cause of this cost increase and outcry from healthcare professionals? KV Pharmaceutical of suburban St. Louis recently won government approval to exclusively sell the drug. The March of Dimes and many obstetricians supported the move, claiming quality and availability will improve.

KV Pharmaceutical justifies the price by claiming it avoids the mental and physical disabilities that can come with very premature births. The cost of care for a preemie is estimated at $51,000 in the first year alone, claims chief executive Gregory J. Divis Jr.

"Makena can help offset some of those costs," Divis tells AP. "These moms deserve the opportunity to have the benefits of an FDA-approved Makena."

A KV subsidiary, Ther-Rx Corp., will be marketing the drug and on Tuesday announced a patient assistance program designed to help uninsured and low-income women get the drug at little or no cost.

Snow and others say the cost increase will land on someone. Much of the cost will fall on health insurance companies, which will have to raise premiums or other costs to their other customers. Some will be the responsibility of cash-strapped state Medicaid programs, which may halt them paying for the drug or enroll fewer people.

"There's no question they can't afford this," said Matt Salo, executive director of the National Association of Medicaid Directors. Salo and Snow said they do not know how many state Medicaid programs currently pay for Makena, which was recommended by the American College of Obstetricians and Gynecologists as a generic.

Aetna will continue to pay for the drug, Armstrong told Stobbe. It is currently covered for about 1,000 women a year, so the new federal endorsement is likely to cost an estimated $30 million more annually.

The treatment calms the muscles of the uterus, experts claim. The study of women at risk for this condition found that only about 36 percent of those given the progesterone drug had pre-term births, compared with 55 percent among those not on the drug.

There is no good alternative in most cases and in the years following the study, more obstetricians, Medicaid programs and others began prescribing it. It is estimated 130,000 women a year might benefit from the drug. Only a fraction of them receive the treatments but the number has been increasing.

Ther-Rx has begun a patient assistance program promising free injections or much reduced prices based on income. Uninsured households making less than $100,000 are eligible for a copay of $20 or less.

Ther-Rx and its parent company became involved about three years ago, acquiring the rights to the drug from a Massachusetts company named Hologic Inc., said Divis.

To get FDA approval, the company is spending hundreds of millions of dollars in additional research, including an international study involving 1,700 women, Divis explains. The FDA last month signed off and gave Makena orphan drug status. That designation ensures Ther-Rx will be the sole source of the drug for seven years.

The March of Dimes, which gets hundreds of thousands of dollars in funding from Ther-Rx, celebrated the approval in a press release, saying if all women eligible for the shots receive them, nearly 10,000 spontaneous premature births could be prevented each year.

Many doctors said they were satisfied with the original version from compounding pharmacies, and Aetna's Armstrong said she was unaware of any quality concerns. Still, doctors will use the Ther-Rx brand, in part because of legal worries.

Last month, KV sent cease-and-desist letters to compounding pharmacies, telling them they could face FDA enforcement actions if they kept making the drug, which effectively halted production.